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Intrapersonal Utility Comparisons as Interpersonal Utility Comparisons: Welfare, Ambiguity, and Robustness in Behavioral Policy Problems / Canishk Naik, Daniel Reck.
- Format:
- Book
- Author/Creator:
- Naik, Canishk.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w32813.
- NBER working paper series no. w32813
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2024.
- Summary:
- Inconsistent choice undermines the revealed preference foundations of traditional welfare economics, leading to controversy about policymaking in the presence of behavioral frictions. We model an optimal policy problem wherein a benevolent planner is uncertain which behavioral frame reveals normative preferences. We axiomatize welfarist criteria that are similar to social welfare functions, with intrapersonal frames replacing interpersonal types. Under paternalistic ambiguity aversion or paternalistic risk aversion, the planner values policies that are robust to normative uncertainty. We apply these welfarist criteria and robustness concepts in examples, including default options, manipulation of reference points, present focus, corrective taxation for internalities, and nudging.
- Notes:
- August 2024.
- Print version record
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